A. O. Smith Corporation (NYSE:AOS) was in 11 hedge funds' portfolio at the end of March. AOS shareholders have witnessed an increase in hedge fund interest in recent months. There were 10 hedge funds in our database with AOS positions at the end of the previous quarter.
In the 21st century investor’s toolkit, there are plenty of metrics shareholders can use to watch publicly traded companies. A duo of the most innovative are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the top investment managers can trounce the S&P 500 by a significant amount (see just how much).
Equally as beneficial, positive insider trading sentiment is another way to break down the marketplace. There are lots of reasons for a bullish insider to downsize shares of his or her company, but just one, very clear reason why they would buy. Several empirical studies have demonstrated the market-beating potential of this method if investors understand what to do (learn more here).
Now, let's take a peek at the latest action surrounding A. O. Smith Corporation (NYSE:AOS).
Heading into Q2, a total of 11 of the hedge funds we track were bullish in this stock, a change of 10% from the previous quarter. With the smart money's sentiment swirling, there exists a few notable hedge fund managers who were upping their stakes considerably.
Of the funds we track, Columbus Circle Investors, managed by Donald Chiboucis, holds the biggest position in A. O. Smith Corporation (NYSE:AOS). Columbus Circle Investors has a $47.6 million position in the stock, comprising 0.4% of its 13F portfolio. The second largest stake is held by Chuck Royce of Royce & Associates, with a $36.6 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Some other hedge funds that are bullish include Cliff Asness's AQR Capital Management, Israel Englander's Millennium Management and Jim Simons's Renaissance Technologies.
Now, key hedge funds were breaking ground themselves. Renaissance Technologies, managed by Jim Simons, established the most valuable position in A. O. Smith Corporation (NYSE:AOS). Renaissance Technologies had 4.2 million invested in the company at the end of the quarter. D. E. Shaw's D E Shaw also made a $1.3 million investment in the stock during the quarter. The only other fund with a new position in the stock is Jacob Gottlieb's Visium Asset Management.
Insider trading activity, especially when it's bullish, is most useful when the company we're looking at has experienced transactions within the past six months. Over the latest half-year time frame, A. O. Smith Corporation (NYSE:AOS) has seen zero unique insiders buying, and 13 insider sales (see the details of insider trades here).
Let's also examine hedge fund and insider activity in other stocks similar to A. O. Smith Corporation (NYSE:AOS). These stocks are General Cable Corporation (NYSE:BGC), EnerSys (NYSE:ENS), Belden Inc. (NYSE:BDC), Woodward Inc (NASDAQ:WWD), and REGAL-BELOIT CORPORATION (NYSE:RBC). This group of stocks are the members of the industrial electrical equipment industry and their market caps match AOS's market cap.